Bar on multiple directorships dropped to aid trust takeovers

The chairs and non-executive directors of foundation trusts are already able to sit on more than one board, but those of non-FT providers are not. The DH now intends to remove that restriction, saying it is “no longer justified or fit-for-purpose”.

The move means, for example, that the same individual will be able to chair two separate NHS trusts, or a trust and a foundation trust.

A DH impact assessment of the change in secondary legislation suggests it could help mergers and acquisitions of troubled trusts. It states: “Where an NHS Trust has been identified as unsustainable and either needs to be acquired by or merge with another organisation it would aid the work to prepare for these types of transactions if there could be some shared membership between the boards of the organisations affected in advance of such a merger.”

However, an NHS Trust Development Authority spokesman said it was also becoming “increasingly challenging” to recruit “high quality candidates” to chair and non-executive roles at trusts.

“There have been times when we have had to run multiple recruitment rounds to get the right candidate,” he said. “This change in criteria will make it easier for us to better use the skills of our existing chairs and non-executives.”

The regulation change is expected to take effect on 14 April.

Nigel Edwards, chief executive of the Nuffield Trust, said the changes could be intended to encourage the formation of NHS hospital chains, an idea Salford Royal Foundation Trust chief executive David Dalton has been tasked with exploring.

Mr Edwards told HSJ: “I suspect it’s to do with this chains policy that’s suddenly become very popular and is being put [forward] by the Department quite strongly.”

However, he suggested encouraging shared leadership between potential merger partners could be at odds with competition regulations. “One bit of the system seems to see chains and mergers and acquisitions as the solution to problems, but [this] seems to be a conversation that’s slightly independent of the discourse about competition and choice,” he said.

“It’s not immediately clear how that gets reconciled but my understanding of the legislative position is that competition and choice has the upper hand in terms of regulatory decisions. It’s interesting but indicative of perhaps some slightly divergent and potentially contradictory policy.”

The amendments will also allow a partner or employee of a primary care service to be appointed as a non-executive director of a trust, but not a chair. The document states that while it is “considered beneficial for trust boards to have consideration of the wider healthcare system” potential chair candidates should be limited to those “whose primary expertise lay in the field of secondary care”.

While executive directors will now be able to take on non-executive roles at other trusts, they will not be able to take on a chairmanship as “the workload involved would be too substantial”.